Improving building societies’ & banks’ services to customers suffering loss of mental capacity

1. Improving building societies’ & banks’ services to customers suffering loss of mental capacity APAD ANNUAL CONFERENCE 2014 James O’Sullivan, Building Societies Association8 May 2014 Jos.v.Final

2. Agenda • Improving the service we give to Deputies & other 3rd party mandate holders • Supporting fluctuating mental capacity • Supporting families & carers with no formal mandate • Tackling abuse • Looking ahead 1

3. Personal banking services Deposit-based savings Mortgages Unsecured lending Out of scope – comment on individual firms Scope

4. Our responsibilities What is a building society? • Support your customers inkeeping control of their financial affairs • Protect the customer, their assets & their privacy • Comply with relevant legislation & regulation • Supporttheir carers & their families • Manage every account holder’s issues individually • Don’t be substitute medical, social work or legal professionals

5. Our services to Deputies What is a building society? Improvement areas: • Improving support for Deputies & other appointed 3rdparty representatives • Improving basic understanding • Getting the frontline to use the help available • Getting firms to think of attorneys as customers • Wider understanding of the stress involved in taking responsibility as a Deputy or Attorney • Offer more convenience - digital access to accounts for attorneys etc.

6. Service issues – session 1 What is a building society?

7. Service issues - session 2 What is a building society?

8. A f ramework for a uthorising people wanting to operate a bank account for someone else Guidance for Banks and Building Societies Version 8.2 .2013 Making improvement happen What is a building society? • Industry guidance launched in April 2014. • Aims to deliver consistency of policy & set expectations on practice. • The start of the journey not the finish • Issues still to be addressed: • Training burden • Culture • Canteen culture • Lack of life experience

9. How you can help us What is a building society? • Feedback on service provided – “Critical friend” • Recognise good service • Information exchange through APAD / BSA • Support training initiatives • OPG e.learning packages • Lessons from training your own people?

10. Supporting fluctuating capacity Legal & regulatory framework is comparatively loose: • Mental Capacity Act 2005 • OFT - “Mental health – guidance for creditors” • Lending Standards board – “Mental health & debt” 2011 For each transaction the key test is: “Does the customer understand the nature of the transaction and the advice given to them at the time of the decision to transact.” • No firm guidance as to what a building society / bank should do when they feel that this test is not passed. 1

11. Chip & Signature Signature templates Big Print A friendly face Supporting fluctuating capacity Practical help to make finances more manageable: 1

12. Families & Unofficial carers Carers who are not appointed representatives • An increasing minority • Often deterred by the cost & complexity of formal mandate arrangements • While LPA or Deputyship is the correct next step sometimes situations are urgent. • FS firms having to make value judgements aboutthe account holder’s best interests • Families – building societies & banks in the firing line • Mental capacity disputes • Disputes between appointed representatives & family members • Compensation culture – esp. for loss to crime. 1

13. Preventing abuse Individuals with mental capacity issues are an easy target for crime and financial abuse: • Financial abuse cases have rocketed since the credit crunch • Organised crime is now involved • BUT – 75% of abuse is committed by someone that the victim already knows (Alzheimer’s Society survey 2011) How our sector helps prevent financial abuse: • Alerting customers to scams • Looking out for signs that abuse is taking place • Reporting abuse to local authority vulnerable adults teams – to support the victim. • Reporting crime to the police etc. – to take out the criminal • Better information sharing on suspicions of abuse. 1

14. FS industry issues – session 1 What is a building society?

15. FS industry issues - session 2 What is a building society?

16. Looking forward What will change in the digital age? 1

17. Looking forward The particular challenge of the digital age – the changing relationship with the customer • How do you know whether your customer is starting to suffer from loss of mental capacity when you rarely see them or speak with them. • Providing additional help & protection in digital form – or do you take that choice away? Others • Making it simple to prepare for loss of mental capacity • Supporting appointed 3rd party representatives with digital services (they will expect the same service as they get as individuals) • Helping families where there is no appointed 3rd party representative. Above all – keeping the balance 1

18. Questions